In your QuickBooks account, you have received a check but it got bounced so now you want to know how to handle this. Here, is the article that is all about how to record bounced checks in QuickBooks.
Here are the ways to record the checks that got bounced. So you decide using which way you want to record it into your books. You just go with one of the processes and follow the detailed steps to get it done easily into your QuickBooks account.
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How to Enter Bounced Checks in QuickBooks?
In QuickBooks Desktop you get the option for recording the bounced check that was received as the payment. You have received it in your sales receipts or invoices from customers. QuickBooks tags the invoice and the Unpaid and then allows you to enter the fees charged by the Bank for the bounced check. For this, QuickBooks create a new invoice for the Non-sufficient Funds (NSF) fee that is charged by the bank. You have to send it back to the customer with the bounced check. Here are the steps to t enter the bounced check in QuickBooks:
- In the Windows system, open the QuickBooks software.
- Click on the Customer menu from the top of the window.
- From Customer drop-down options, select the option Receive Payment.
- The new window opens-up.
- In this, you have to locate and then select the customer payment that is canceled because of a bounced check.
- The new window of Receive Payment opens up on your screen.
- You have to click on the option Record Bounced Check that is at the top right side of the window.
- Managed Bounced Check window opens up.
- In this window, mention the fee that is charged by the bank for a bounced checks and the date in the adjacent column.
- Click on the Expense Account from the menu options where you have charged the NSF from the bank.
- Choose Class if you have enabled the QuickBooks Class tracking.
- Now, in the late Customer fee, mention the amount to be charged from the customer for the bounced check.
- Review it carefully and then click on the next button to continue.
- It opens the Bounced Check Summary Window and shows you what happen when you record bounced check.
- You have to note down the transactions that are marked as Unpaid from the QuickBooks.
- Then review it for the final time.
- After that, click on the Finish button.
How to Enter a Bounced Checks in QuickBooks Online Using Journal Entry?
This is one of the methods to record an NSF check in the QuickBooks Online using the Journal Entry. You have to create the Journal Entry first that represents the non-payment amount. After that, delete the original invoice that was created for the customer.
Create the service item for bounced checks and the fees. Using this you can add them to the invoice that you can later send to your customer. So do create 2 items one for the fee from the bank and the other for the charges you want to collect from your customer for this bounced check fee.
The steps to create items are as follows:
- In QuickBooks, click on the Gear icon.
- Then from the list shown.
- Choose Products and Services option.
- Click on the New and then select the Service option.
- You have to name the item as Bounced Check Fees.
- In the Income account, click on the drop-down arrow.
- Choose the account to track the bounced check.
- Click on the button Save and close and you are done with creating an item.
Steps to Record Bounced Check using Journal Entry
Follow the steps to record bounced check using journal entry:
Step 1: Create a Journal Entry
- In QuickBooks navigation Panel.
- Click on the + sign that is New button.
- Then select the other section.
- After that, click on the Journal Entry.
- Mention the date of bounced check by bank in the journal date field.
- In the first line of the account, click on the Account Receivable (A/R).
- Mention the amount that was mentioned on the bounced check in the Debit column.
- Then mention the name of the customer in the name field.
- Go to the Second line, click on the bank account in which the check was bounced.
- The credit amount is going to be auto-fill in the column.
- In the Description field, you have to write down the brief description of the check that is bounced.
- Then click on the Save the entry to save it properly.
After this, you have to delete the original invoice and then attach the bounced check with the journal entry that you just created.
Step 2: Remove the original Invoice and then Link the Bounced Check
- In QuickBooks, go to the left-side menu.
- From the menu, click on the Sales or Invoicing.
- The new window opens-up.
- In this, click on the Customer tab.
- Then select the Customer who issues the bounced check from your transactions list.
- You have to remove the tick mark from the invoice to which the bounced check was applied.
- Then select the Journal entry to attach with that invoice.
- In the end, click on the Save and then close the window.
Step 3: Enter the Bank Service Fee for a Bounced Check
- Click on the New button.
- In the Vendors, click on the option Expenses.
- Go to the Payee field.
- Mention the name of your Financial Institution.
- In the Payment date field, enter the date on which the check is bounced.
- Mention the NSF Fees in the field of Ref No.
- In the first line, click on Category and select option Bank Charges expense account.
- Go to the Amount column.
- Mention the amount that the bank charged for the bounced check.
- After that, click on the Save button to save these changes.
Step 4: Create the Invoice for the Bank Service Fee
- Click on the + sign that means New.
- In the Customers option.
- Select the Invoice.
- After that, choose the name of the customer.
- Enter the date in the Invoice date field. This date is when the check was bounced.
- Go to the Product and Services column.
- From further options, select the Bounced check fee item that you have created.
- Mention the amount of bounced check.
- Click on the Save and Close button.
Step 5: Then Print the Statement to Send it to the Customer
Print the statement by mentioning its type of statement, and with start and end date. Click on the print to make its copy. After making the copy, you have to send it to the Customer for receiving the payment.
Step 6: Receive the Payment of the Customer for the New Invoice
When you receive the payment from your customer who issued the bounced check. Make the new account for it under Receive payment that shows the date and type of the payment. In this, you also mentioned the deposit done in the account and the amount you received.
How to Record a Bounced Checks in QuickBooks Online using Write Checks?
To return a check into QuickBooks Online is different from the desktop version. So here are the steps in detail that help you to record a bounced checks in QuickBooks Online using write checks. The steps are as follows:
Step 1: Write the Check to Record the amount Decreased in the Bank Account
- In QuickBooks Online, go to the left side menu.
- Click on the New button shown as the + sign.
- Go to the Vendors column and then click on the Check option.
- The new window opens up with Write Check name.
- In this window, you have to fill the following fields.
- Payee
- Description
- Account Details
- Payment Date
- Bank Account
- Amount
- Memo
- Then click on Save and Close button.
Step 2: Create a new Service item for the Bounced Check and the NSF Fees
- In QuickBooks, click on the Gear icon at the top.
- Then in the List Column, choose Product and Services.
- Now, click on the New button to create new.
- Select the Services option from the panel of Product and Services.
- Mention the Bounced check in the Name field.
- Further, choose the bank account in the Account field.
- Click on the Save and New button to create another item.
- Now name the Second service as the Bounced Check Fees and add the new account.
- Or you can also select the Expense Account for tracking the charges of a bounced check.
- When you are done, click on Save and Close button.
Step 3: Create the Invoice for Bounced Check NSF Fees
- In the Navigation Panel, click on the New button that is + sign.
- In the customers, click on the Invoice option.
- Mention the name of the Customer and also the invoice Date on which it is created.
- From the field Product and Services, click on the Bounced Check Fees that you just created before.
- Now do mention the description for the bounced check.
- Enter the amount that you want to charge from the customer in the Amount field.
- Click on the Save and Close button when you are done.
Step 4: Enter the Bank NSF (Non-Sufficient Fund) Fees as the Expense
- In QuickBooks left panel, click on the New option.
- Go to the Vendors and then further click on Expenses.
- Choose the bank account of which the check was bounced.
- In the field of Payment Date, mention the date when the check was bounced.
- In the field of Ref No. mention the Bank NSF Fees.
- In the Account Details, click on the bank that you used to track the bank charges.
- Enter the Bank NSF Fee in the Amount field.
- Hit on Save and Close button to save it and close this window.
Step 5: Print and Send Statement to the customer
- Open the Sales and Invoicing from the QuickBooks left side panel.
- Now choose the name of the customer who sends this bounced check to you from the Customer tab.
- You get the transaction list open in front of you.
- From the New Transaction, click on the Statement.
- In the window of Create Statement, choose the type of this statement, start date, and the end date of the statement also.
- When you are done by reviewing it.
- Click on Save and Send button.
- You have to choose the email and send it to the customer.
Here, you get to know how to record a bounced check in QuickBooks. So you get to know all the different ways to record the bounced checks. You have to go with the one way that you want to do according to your requirements.
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Frequently Asked Questions (Faqs)
How can I Print the Statement to send it to the Customer after Recording Bounced Check in QuickBooks?
In QuickBooks, click on Sales or Invoicing from the left menu. Go to the Customers tab. Choose the name of the customer who gives the bounced check. This opens the Transactions List. Create the service items for bounced checks and fees that used in recording the charges. You have to choose the Statement Type. Set the Statement Date, Start Date, and also the End Date. Tick mark the recipient’s name checkbox. Click on the Print button to make a copy of this statement. You can also click on Save and Send button to create the email to send it to the customer.
How can I apply to a new Invoice after Receiving the Customer’s Payment in the Process of Recording Bounced Checks in QuickBooks?
Click on the New button that is shown as + sign. In the Customers option, choose the Receive Payment. Further, click on the Customer field drop-down menu to select the customer. Mention the payment method and the payment date for this new payment. Click on the Deposit to the field to mention the account for a deposit from the drop-down menu. Mention the received Amount. Click on the invoice that you have created from the list of Outstanding Transactions. In the end, click on Save and Close button.
If I already set up the item before then do I have to set it up again while doing the Process above to Record Bounced Checks in QuickBooks?
No, you do not have to set up item again if you have already created it before. Then you have to skip this step and move forward to another step. But if you have not created it before then do create it with the mentioned steps to get it done easily.
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